Australia is a country in the Southern Hemisphere and it is the world’s sixth largest country by total area. The currency used in Australia is called the “Australian Dollar” which is represented as AUD and with a symbol of either $ or A$. A$ is used to differentiate the Australian dollar with the other country’s dollar signs.
The current position of the Australian dollar is fifth in the global foreign exchange market. The rate of 1 Australian dollar = 1.0149 U.S. dollars. It has a high interest rate so the currency traders prefer to use the Australian dollar and it seems to prevail after the steady growth of the Australian economy.
What is the history behind the Australian dollar? In 1965, the Australian Prime Minister suggested for the currency name to be the “royal” while some others suggested “the austral”, “the oz”, “the boomer”, and so on. Finally the currency name was chosen to be “the royal” but it remained unpopular throughout the country and was later dropped. The dollar came into the act in February 1966 and the rate of currency was about two dollars/Australian pound or ten Australian shillings/dollar. These currencies are issued from the Australian Reserve Bank and the first series of notes were issued in 1966 with $1, $2, $10 and $20. Later in the 1970’s and 1980’s the $1 & $2 notes were replaced with a coin and the bank issued $50 and $100 notes in addition.
The value of the Australian dollar seemed to decrease during the period of 2001-2008 but has steadily risen since; currently it is being tradedat a $1.1080 against the US Dollar. There is a prediction that the Australian dollar could even rise as much as $1.70 against the USD by 2014.
What is an inflation rate? An inflation rate is the rate of increase in Consumer Price Index over time and it decides the currency rate with its increase or decrease in value. Most of the countries will try to have their inflation rates to be lower and they would mostly look to have a zero or negative percentage. Australia has around a 3.3% inflation rate so the investors are not too worried about investing their money in the Australian dollar market.
The Australian dollar has proved to be the ideal currency to invest in, if you’re expecting an increase in prices with copper, gold and aluminum since these products have contributed to nearly 14% of the country’s economic growth. The Australian dollar or the Aussie has relatively high interest rate of around 7% against the US dollar and the Australian Reserve Bank has forecasted to increase the rates in the following year. The investors can rely on the Australian dollar as its economic growth is good and it efficiently stands as the fifth most traded currency around the world’s foreign exchange markets.
For many decades Australia’s trade has been mostly dependent on the commodity exports but now they are having an eye on the reserve currencies which tend to be strong even though there is a fall in stocks.
All rights reserved 2023 Currency Information and Research